How Does the BCP Tax Credit Work?

Unlike grants, there is no appropriation fund backing up the BCP tax credits. The credit is “refundable,” meaning that a taxpayer to whom credit is allowed must first use the credit on a dollar-for-dollar basis against their tax liability (to zero, for individuals, or to the statutory minimum tax, for corporate taxpayers), and any excess amount of the credit is treated by law as an overpayment of tax for the year in which the credit is allowable, and to be refunded to the taxpayer (without interest). The BCP tax credit is claimed by filing a New York State income (or franchise) tax return. Non-resident taxpayers may claim the BCP tax credit by filing New York non-resident tax returns. BCP tax credit claims are processed by the New York State Department of Taxation and Finance in connection with each eligible taxpayer’s return. BCP tax credits are paid at the State level and do not impact in any way the local tax base.